The danger of repeat business

Nobody puts baby in a box

I could see the realisation on the managing director’s face before they said it.

“Our clients don’t put us in a box. We put ourselves in a box”.

We were working through the various ways her recruitment consultants brought up the subject of price with their clients. And we could both see the pattern emerging.

When a consultant spotted the client had worked with the agency before, they immediately told the client they’d continue with that rate. 

And if there was a hint of a PSL in place, the consultant would leap to honour that agreement. 

The MD could see what was missing. “We’re not taking into account how long ago the rate was agreed. Or which team agreed it, or the state of the market back then, or the type of role.”

“And when we talk about PSL rates, we’re not checking how many roles the client has given us as part of that agreement.”

Of course these consultants were keen to get working on the new roles rather than bring up a potentially difficult conversation about fees.

But, as the MD realised, it wasn’t clients putting the agency in a box of low fees and PSLs. The consultants were putting themselves in that box.

And those low fees were holding back the growth of the agency.

This is a common situation in recruitment. If you’re struggling with low fees despite offering a great service, take a moment before you blame your clients. You may find that you’re putting yourself in the box you want to escape from.

If you want an expert to help you understand where you are now with your pricing, and spot the opportunities to grow, simply reply to this email and I’ll explain more about my consultation service.  

Jon

P.S. If you can’t talk pricing with people you’ve worked with before, who can you talk to? 

It can be a real challenge to prove your value to a new client. But when a client is coming back to you, they clearly value what you do.

And they might well agree to higher prices, especially if you can show that conditions have changed.

Think about how you talk about fees with returning clients. Are they putting you in a box, or are they?

If you want an expert to help you understand where you are now with your pricing, and spot the opportunities to grow, simply reply to this email and I’ll explain more about my consultation service.